Sequel to ban on old vehicles: black-marketing in cars on rise
ZAHEER ABBASI
ISLAMABAD (October 04 2007): The black-marketing in cars, which was totally discouraged when the import of used cars was liberalised, has been on the rise once again after capping import of five to three years old cars in the 2007-08 budget.
The All Pakistan Motor Dealers Association (APMDA), in a letter following the budget, addressed to the Prime Minister, had expressed fear that limiting import of used cars to three years would revive black-marketing.
Drawing attention of the Prime Minister to the issue, the APMDA wrote that abrupt reduction in capping import of used cars would hurt the investors of both sides financially.
The letter said that change in the policy would encourage local assemblers to monopolise the auto market and they would charge prices from the people at their own will. It said that the new policy on used cars would further encourage local assemblers to return to their old habit of slackness and remaining indifferent to the quality of their products.
The local assemblers had started to improve the quality of their products because their products were challenged by the used cars in the local market and sale of many locally made brands had declined. Besides, a large number of reconditioned cars are still waiting in Japan to be loaded on ships, the letter added.
When contacted, APMDA Chairman M Sahazad confirmed to Business Recorder about the letter and asserted that there had been phenomenal increase in the 'on money' on almost all cars. For Suzuki Potohar and Suzuki Hi-roof and Pickup it is Rs 45,000. The 'on money' on other models of Suzuki ranges from Rs 12,000 to Rs 26,000.
All Toyota brands cost from Rs 25,000 to Rs 65,000 as 'on money'. Toyota Diesel, which carried no 'on money' earlier, is now available only in the black market.
Before the budget, he said, the premium known as 'on money' charged for delivery had almost gone but the situation has changed entirely. Booking/delivery period for Suzuki cars is around six months and for different models of Toyota it is four to six months whereas before budget, the delivery period was between one and half month, he added.
Copyright Business Recorder, 2007